Fuel Costs, Congestion Causing Lower Company Car Mileage in the U.K.

The rising cost of fuel, better communications technology and high levels of congestion are causing a decrease in company car mileage and fleet fuel costs in the U.K, according to the U.K.’s Fleet News.

That is causing some fleet managers to attempt to renegotiate contracts with their lease providers and lower annual mileage allowances.

The British Vehicle Rental and Leasing Association. (BVRLA), whose members provide lease vehicles to company fleets, is seeing a noticeable reduction in the annual mileages of company cars.

BVRLA Director General John Lewis said more fleets may choose to extend their existing contracts for another 12 months instead of taking on new lease vehicles because it gives them the benefit of a shorter contract time during what he said was a period of economic uncertainty.

Lewis added that the general view across the industry is that the supply of new cars into fleets is looking very healthy. He said he believes that organizations are encouraging their employees to opt for a company car instead of the cash because it gives them a tighter control on vehicle costs, safety and standards.

According to Fleet News, GE Capital Solutions, Fleet Services wrote in its quarterly Company Car Trends report that despite business mileage falling, the provision of company cars for employees is rising.